Months of economic turmoil has pushed the average landlord’s mortgage debt up 19% to £558,423 in the last 12 months.

This growth has been driven by a greater reliance on borrowing, as the average number of buy-to-let loans has also increased by 12%, up from an average of six in Q1 2022 to 6.7 in Q1 2023, according to research by Octane Capital.

The West Midlands saw the largest rise in the number of loans held, up 49%, resulting in a 33% increase in the amount of money owed via buy-to-let loans, the fourth highest increase of all regions. 

Annual increase

Both the South East (+49%) and East of England (+29%) also saw a big uplift in the average number of buy-to-let loans held per landlord, with the South East seeing a 95% annual increase in the amount owed, and a 90% rise in the East of England. 

CEO Jonathan Samuels (pictured) says while it’s clear that a lot of landlords are willing to saddle more debt to keep their operation moving, it’s inevitable that a significant number will either downscale their ambitions or jump ship entirely.

Properties overlooked

For those willing to stick it out, there is a real opportunity being presented by the properties either offloaded or overlooked by others, says Samuels. “While now might not seem like the best time to increase the size of your portfolio, being bold when others are meek can bring reap rewards in the long-term - especially now that mortgage rates have shown signs of easing.”

David Hannah, group chairman at Cornerstone Tax, says the fact that professional landlords are now buying up former buy-to-let properties and putting them back on the rental market will mean a resurgence in the wider availability of rental properties. 

He adds: “New measures should be considered and introduced into the rental market for aspiring landlords as it is becoming an increasingly unattractive environment for them.”